Columbia Banking System, Inc.

Welcome to the Columbia Banking System third quarter 2024 earnings conference call. At this time, all participants are in a listen-only mode. After the speaker's presentation, there will be a question and answer session. To ask a question during the session, you will need to press star 11 on your telephone. You will then hear an automated message advising your hand is raised. To withdraw your question, please press star 11 again. Please be advised that today's conference is being recorded. At this time, I would like to introduce Jackie Bolin, Investor Relations Director, to begin the conference call.

Thank you, Gigi. Good morning, everyone. Thank you for joining us as we review our third quarter results. The earnings released in corresponding presentation are available on our website at ColumbiaBankingSystem.com. During today's call, we will make forward-looking statements which are subject to risks and uncertainties and are intended to be covered by the safe harbor provisions of federal securities law. For a list of factors that may cause actual results to differ materially from expectations, please refer to the disclosures contained within our SEC filing. We will also reference non-GAAP financial measures and I encourage you to review the non-GAAP reconciliations provided in our earnings material. We'll now hand the call over to Columbia's President and CEO, Clint Stein.

Thank you, Jackie, and good morning, everyone. Our third quarter activities and results demonstrate our commitment and continued progress toward regaining long-term top quartile performance. We grew core deposits, even as we reduced their cost. We also completed the near-term initiatives we detailed in April, and we continue to reinvest in our people, systems, and processes to drive our franchise profitably forward. When we spoke last quarter, I outlined the drivers of $270 million in merger-to-date gross expense reductions, and we fully achieved our target during the third quarter. Our operational effectiveness work eliminated redundancies and streamlined operations, making our organization more efficient. This work is enabling us to better serve our customers and our communities while enhancing long-term shareholder value. Our gross expense saves represent double the $135 million we outlined at the announcement of the merger. The merger-to-date net savings of roughly $213 million accounts for $45 million of franchise expansion and reinvestments made leading up to and shortly after the merger close, as well as the additional $12 million of investments planned in the coming months and quarters. Our expense run rate in the third quarter was just below the expected fourth quarter annualized run rate we have consistently discussed since March. Planned reinvestments will continue into 2025. Our cost-conscious culture will support a reasonable amount of inflationary lift from this level. However, we will continue to remain diligent with resource allocation and work to find expense offsets for franchise reinvestment beyond the $12 million already earmarked. We believe our reinvestment dollars will support the continued growth and competitiveness of our company. We continue to remain an employer of choice for experienced bankers throughout our footprint. Our ability to attract top talent enabled us to enter and grow our newer markets like Arizona, Colorado, and Utah, while continuing to invest in long established regions. Recent examples include establishing a team of seasoned private bankers in Colorado, commercial banking teams in southern Idaho and northern California, and a new market leader for southern Nevada. In all cases, these new team members have spent their careers serving a broad range of customers, ranging from families and entrepreneurs up through larger commercial clients within these markets. We opened our second retail branch in Arizona and announced a planned third location in Mesa to supplement the commercial teams that established our presence in the state three years ago. Subsequent to quarter end, we have identified the site for our fourth Arizona office and will provide more specific details on next quarter's call. We also continue to enhance our internal technology in support of our associates. We are piloting applications to improve efficiency and we are onboarding a thousand associates to an upgraded CRM tool. The third quarter also included a reduction in transactional loans and funding sources. Solid seasonal customer deposit growth and an intentional reduction in transactional real estate loans enabled us to reduce broker deposits by 20% during the quarter. Although commercial loan growth was below our expectations, portfolio activity reflected healthy customer behavior, which Chris will cover in more detail. We are very optimistic for the future of our company. With the merger and integration behind us, Activity throughout our organization is fully focused on driving balanced growth with new and existing customers, and we continue to win business every day. We're driving franchise value through relationship banking, and we will continue to opportunistically reduce our exposure to transactional loans and funding sources. We continue to remain laser-focused on regaining Columbia's placement as a top-performing bank that produces long-term, consistent, and repeatable results. I'll now turn the call over to Ron.